Acquisitions refer to the action or process of gaining or obtaining control over assets, properties, or companies through various means such as purchasing, merging, or taking over. In the business context, acquisitions are commonly associated with mergers and acquisitions (M&A), a strategic corporate activity used to expand operations, improve market share, or strengthen competitive positioning.
An acquisition occurs when one company acquires another, usually by purchasing a significant portion or all of its shares or assets. This purchase can be made through a cash transaction or by exchanging shares, thus resulting in the acquiring company gaining control and ownership over the acquired company. Acquisitions can also involve the absorption of one company by another, resulting in the integration of their operations, resources, and market presence.
The act of making acquisitions is driven by various motives, including increasing market presence, diversifying product or service offerings, accessing new technologies or distribution channels, eliminating competition, achieving economies of scale, or gaining talented human resources. Upon successful completion of an acquisition, the acquiring company takes on the responsibility for managing the acquired company's operations, employees, and assets.
Acquisitions can be complex and involve legal, financial, and operational considerations. Due diligence is commonly conducted to assess the value and risks associated with the acquisition. It involves conducting in-depth research, financial analysis, and evaluations of the target company to ensure compatibility, synergy, and financial viability.
In summary, acquisitions refer to the process of gaining control over assets, properties, or companies by purchasing or merging with them, typically aimed at achieving strategic objectives such as expansion, increased market share, or enhanced competitiveness.
